LONDON/ZURICH, Nov 7 (Reuters) - Nestle, the world’s largest food group, is selling the bulk of its Jenny Craig weight-loss business to a U.S. private equity firm, part of a trend among consumer goods firms to shed underperforming businesses in a faltering global economy.

The Swiss group said on Thursday it was selling the Jenny Craig business in North America and Oceania to North Castle Partners for an undisclosed sum, which analysts said was likely to be below the $600 million Nestle paid for it in 2006.

“It is a sign the company is carrying through with its commitment to weed out duds if they can’t be turned around,” said Jon Cox, an analyst at brokerage Kepler Cheuvreux in Zurich, who welcomed the deal.

Despite a worsening obesity epidemic in the United States, weight-loss programme providers such as Jenny Craig, Weight Watchers International and Medifast Inc have been hit hard by weak economies and competition from a host of electronic apps that count calories for free.

Earlier this week, Medifast forecast weaker-than-expected full-year sales, while Weight Watchers said last month revenue this quarter would fall by a low double-digit percentage.

Nestle boss Paul Bulcke also told investors last month there would be disposals, though he did not give names. “We want to be in business, not in agony,” he said.

Nestle bought Jenny Craig from private equity groups ACI Capital and MidOcean Partners as part of a push into nutrition that has also seen the maker of KitKat and Crunch bars expand into baby food and sports nutrition.

But several of its brands, including PowerBar energy bars, have failed to take off, and Nestle has posted lacklustre results in recent quarters. Reuters reported in September that it was seeking to unload PowerBar as well.

Several consumer goods groups are pruning their portfolios as faltering economies have made trading more difficult worldwide. Unilever recently sold its Skippy peanut butter and Wishbone salad dressings, Campbell Soup Co sold its European business and Reckitt Benckiser is exploring options for its pharmaceuticals business.

GROWING WITH THE TIMES

When Nestle bought Jenny Craig, which was founded in 1983 by an Australian of the same name together with her husband Sid, it had annual sales of $400 million and was growing at a double-digit percentage with 3,000 employees and 600 centres, according to analysts at Vontobel.

“With the economic crisis, sales started to stumble,” Vontobel said in a research note, estimating current year sales at around 300 million Swiss francs ($329 million). “The brand was loss-making and has been destroying value for years.”

Nestle hasn’t provided any recent figures.

Jenny Craig’s new owner, based in Greenwich, Connecticut, focuses exclusively on health and wellness businesses and is credited with turning around Atkins Nutritionals after buying it from its post-bankruptcy lenders in 2007.

The executive whom North Castle had running Atkins, Monty Sharma, will run Jenny Craig together with the Curves International fitness club chain he runs now.

In addition to benefits from the combination, North Castle Managing Director Jon Canarick expects to build on Jenny Craig’s brand recognition in the United States and Australia.

“We believe we can tailor the marketing more specifically toward what Jenny Craig is great at, which is one-on-one consultation and food,” he said in an interview.

He declined to provide any financial details.

North Castle expects the deal to close this month. The smaller Jenny Craig business in France is not part of the deal.